The emerging landlord

Foreword – Insuring for success

Tom Cooper, Director of Underwriting, Simple Landlords Insurance

There’s no doubt that it’s been a time of unprecedented change in the housing market and the private rented sector.

If you were to believe everything you read in the media, you would be forgiven for thinking that it was all doom and gloom, negative equity, and people planning their exit strategies.

Headlines have focused on the onslaught upon landlords – the Section 24 tax increases, Capital Gains Tax, Universal Credit arrears, more licensing rules, increased stamp duty, tougher lending criteria, Right to Rent legislation, the social housing crisis, tenant deposit caps, Brexit uncertainty – the list goes on and on.

But curiously, the landlords we spoke to were not painting quite the same dark picture...

Meeting the challenges

Many landlords were clearly adapting to the new environment, spotting new opportunities, and adapting their investment strategies accordingly.

Change of any sort is to some extent a risk factor, and as insurers we’re in the business of risk.

We wanted to find out how landlords were meeting the challenges they face, and protecting themselves for the long term – and how we as insurers could help to support and enable different strategies by mitigating risk and adapting our products.

What we’ve discovered is that the private rented sector is increasingly polarised – by geography, experience, and above all, the size and composition of landlords’ portfolios of investment.

Attitudes split most dramatically between those who own more than one property and those who do not. One man bands, accidental and part-time landlords are being hit the hardest, and feel most negative about their future. This is a large part of the market, and it’s perhaps unsurprising their view has therefore skewed broader perceptions – and media coverage – of prevailing market conditions.

Professional landlords on the up

Meanwhile, the bigger the portfolio, the more positive the outlook. And it is the landlords positioned at the larger end of the market – or aspiring to get there – who are least fazed by changes, and best poised to take advantage of increasing demand, bargain stock being sold off, and stable house prices.

Indeed, estate agent Savills estimates mainstream rents in the UK will rise by 19% in the next five years, and house prices by 13%. For those weathering the storm, sitting tight or investing for the long term, things are far from bleak.

But this is certainly the age of the professional landlord. Keeping abreast of legislative changes and market forces is essential, as is researching and sourcing investment opportunities.

Insuring for success

As Simple Landlords we would, of course, also say that protecting yourself and your investments is now more important for growing landlords than ever.

While every penny of profit counts, we strongly believe that high quality insurance, at the right level for your personal risk can help free landlords to diversify their strategies and think differently about how, when and where they invest. We’re the safety net that lets YOU take the next leap.

Yet we’ve found here that not all landlords are taking advantage of specialist landlords insurance – with one in four using home insurance policies instead, which don’t cover all your letting risks. Meanwhile, not everyone is looking at quality markers, adapting policies for different properties and tenants, or taking advantage of portfolio discounts or savings from switching providers.

We want to support this emerging community of aspiring and professional landlords to grow their portfolios and profits with our back-up.

This report has therefore become both an insight into those landlords, and a guide to how they can use insurance to their ongoing advantage.

I hope you find it an interesting read.

Case studies

  • Reece Richiardi

    Students relaxing in kitchen of shared accommodation

    Reece Richiardi is 25, and has both his own property portfolio and sources and runs projects for other investors.

  • Jasmine Kaur

    Students relaxing in kitchen of shared accommodation

    For Jasmine Kaur, 27, property investment runs in the family and she got her first property at 18.

  • Sue Sims

    Serviced accommodation

    Sue Sims bought her first buy-to-let property at 21. 18 years on and she now has 42 properties in and around Birmingham.

  • Andrea Savvidou

    Students relaxing in kitchen of shared accommodation

    When Andrea Savvidou, 27, stood back and looked at her life, she decided she wanted to do something else with it beyond her day job in the city as an actuary.

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Simple Landlords Insurance is a business name of Millennium Insurance Brokers Limited. Millennium Insurance Brokers Limited are authorised and regulated by the Financial Conduct Authority. Our FCA registered number is 308310. Millennium Insurance Brokers Limited is registered in England and Wales Company No. 2103848. Registered Office: Quay Point, Lakeside Boulevard, Doncaster, DN4 5PL. * More than 10% of new and existing customers paid less than £112.68 for their cover between December 18 - February 19 and more than 50% paid less than £144.02 over the same period.